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CEA: Home Sales To Rise, Portables To Slide In 2002

1/28/2002 02:00:00 AM Eastern


Combined factory-level sales of home and portable audio will slide for the third consecutive year in 2002, but only by 1.1 percent to $6.02 billion compared to 2001's estimated decline of 5.8 percent, according to a Consumer Electronics Association (CEA) forecast.

When broken out separately, however, home audio sales (components, systems and home radios) will rebound from 2001's estimated 4.5 percent drop to grow 2.2 percent in 2002 to $3.99 billion, CEA said.

On the other hand, portable audio sales (boomboxes and headset stereos, including headset MP3 portables) will fall for the fourth consecutive year, this time by only 1 percent to $2.03 billion compared to 2001's estimated decline of 8.3 percent. In 1999 and 2000, sales were off 2.7 percent and 7.1 percent, respectively.

In the portable segment, the winners will be headphone stereos (comprising cassette, CD, MP3 and radio-only models), but boombox sales will drop at a double-digit rate.

In the home segment, the losers will be components, home radios, shelf systems and rack systems, whose sales will be almost nonexistent. The only home audio winner will be home-theater-in-a-box systems, whose sales have risen as the selection of stylish, compact designs — many with built-in DVD players— has grown.

Here's a category-by-category breakout of CEA's unit, dollar and price forecasts for 2002:

Components: Sales will decline for the second consecutive year but at a slower rate, CEA said. Sales will drop 2.5 percent in 2002 to $1.39 billion following 2001's estimated 7.8 percent decline.

Rack, shelf systems: Combined sales in the two segments will fall but not as steeply as they did in 2001. CEA forecasts a 3.1 percent decline in 2002 to $1.36 billion, following 2001's massive 24.8 percent drop.

In 2001, estimated sales fell rapidly in both segments: shelf systems by 23.6 percent to $1.36 billion and rack systems by 50 percent to $42 million. In 2002, CEA forecasts a 2.2 percent drop in shelf-system sales to $1.33 billion and a 33 percent drop in rack sales to $28 million.

Shelf system dollar volume will shrink in 2002 despite a forecasted 2 percent unit-sales gain to 10.2 million units, CEA said. The association attributed the dollar decline to an expected 4.4 percent decline in average shelf-system wholesale prices to $130. In 2001, CEA estimated a 12.9 percent drop in unit sales to 9.98 million and a 12 percent average-price decline to $136.

In rack systems, unit sales will fall 31 percent to 55,000, while the average wholesale will drop 1.9 percent to $515.

HTiB: The packaged home theater segment came into its own in 2001, when the category broke an industry commandment by posting rising sales in unit, dollar and average price. CEA expects the segment to do it again in 2002.

In 2001, dollar sales rose an astounding 131 percent to $765 million on a unit-sales gain of 94 percent to 2.25 million and a 19 percent average-price increase to $340. In 2002, CEA forecasts a 23.5 percent dollar gain to $945 million on unit-sales growth of 20 percent to 2.7 million and an average price boost of 2.9 percent to $350.

Home radios: Unit and dollar sales will fall in 2002, while the average wholesale price will hold steady, CEA forecasts. Dollar volume will drop 5.1 percent to $299 million on a 2.9 percent unit-sales decline to 16.7 million. The average wholesale will stay at $18.

In 2001, dollar sales fell 10 percent to $315 million on a 14 percent unit-sales decline to 17.2 million. Wholesales were also $18.

Portable CD, cassette: Sales of headset CD and cassette players will rise in 2002, but sales of cassette and CD boomboxes will continue to shrink, driving down combined sales by 1.8 percent to $1.92 billion. That will follow 2001's estimated decline of 9 percent to $1.96 billion.

Headset portable sales will rise for the third consecutive year, this time by 4.4 percent to $1.51 billion following 2001's 2 percent increase and 2000's 28 percent gain.

Boombox sales will fall 19 percent to $418 million following 2001's 30 percent decline to $517 million.

MP3 Portables (flash memory, hard drives): Unit and dollar growth will accelerate in 2002, with dollar sales rising 20 percent to $109 million on a unit-sales gain of 32 percent to 825,000. CEA forecasts a 9.6 percent decline in the average price to $132.

In 2001, dollar volume grew 13.7 percent to $91 million on a unit gain of 22.5 percent to 625,000. The average price fell 7 percent to $146.

CEA 2000-2002 Audio Sales Outlook (Units in 1,000's, $ value in millions)

2000 Actual 2001 Estimate 2002 Forecast
Unit Sales Factory $ Value Average $ Price Unit Sales Factory $ Value Average $ Price Unit Sales Factory $ Value Average $ Price
Total audio systems 11,606 1,860 160 10,055 1,399 139 10,230 1,355 132
Rack systems 151 84 559 80 42 525 55 28 515
Compact systems 11,455 1,776 155 9,975 1,357 136 10,175 1,327 130
Separate components -- 1,545 -- -- 1,425 -- -- 1,390 --
Home Theater In-A-Box 1,157 331 286 2,250 765 340 2,700 945 350
Total CD players (1) 54,374 5,002 92 52,200 4,802 92 53,700 4,887 91
Portable CD players 32,161 1,731 54 33,125 1,656 50 34,150 1,639 48
Other CD players 22,213 3,271 147 19,075 3,146 165 19,550 3,248 166
Home radios (2) 19,976 351 18 17,200 315 18 16,700 299 18
Total Tape (3) 16,916 425 25 12,850 303 24 12,200 284 23
Tape players 8,612 217 20 5,700 103 18 5,050 91 18
Tape Recorders 8,304 208 25 7,150 200 28 7,150 193 27
Headset portables (4) 34,865 1,414 41 32,775 1,442 44 33,450 1,505 45
MP3 Players 510 80 157 625 91 146 825 109 132
(1) Includes home, portable and autosound.

(2) Includes table, clock and portable.

(3) Includes radio combinations.

(4) Includes portables counted elsewhere.

Source: CEA ©TWICE 2002